GNYADA April 2016 Newsletter

To read these stories and get the latest news online, visit the GNYADA website at www.gnyada.com

For Dealer Principals / General Managers / Sales Managers The Newsletter A Publication of Greater New York Automobile Dealers Association

New York Auto Show Breaks Weekend Attendance Record 1

APRIL 2016 Volume 26, Issue 3

HIGHLIGHTS

GNYADA Holds Collaborative Meeting on ZEVs page 2

Welcome New Members page 3

NYC Adopts New Transgender Protections page 5 NYS Franchise Law Limits OEM Audits page 7 Job Growth = Car Sales in Metro NY page 9 Social Media Dos and Don'ts for Dealers page 11

The 116th New York International Auto Show retained its title as the highest attend- ed auto show in North America, with record crowds on both its first and final weekends. Adding to the excitement, the show hosted more industry events and attracted more auto executives than ever before, as manu- facturers held more than 20 press confer- ences and introduced over 65 world and North American debut vehicles. Following Press Days, Governor Andrew M. Cuomo joined members of GNYADA’s Board of Directors to open the ceremonial

seatbelt and officially start the 2016 Show, which happened to be the largest opening day in the Show’s history. As major names in film, television, music and sports were drawn to the Javits Center, the vehicles proved to be the true 'stars' of the Show. Attendees filled the Javits Center to look, touch, and smell all newest models and to begin considering their next new car.

NEW: GNYADA Dealer Depot page 12

The Newsletter is published by GNYADA, a not-for-profit organization representing franchised automobile dealers in the New York metro area. 18-10 Whitestone Expressway Whitestone, New York, 11357

For a recap of the 2016 New York International Auto Show, visit autoshowny.com .

Dealer Hotline 718.746.5900

www.gnyada.com

The Newsletter • April 2016 1

GNYADA Holds Collaborative Meeting on ZEVs Dealers inform regulators of barriers to achieving CARB’s sales goal

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regions. They jointly put forth these arguments:

During the opening week of the 2016 New York International Auto Show, GNYADA hosted a meeting between environmental agency representatives

include: rebates for fuel cell, electric, and plug-in hybrid vehicles with bat- tery capacities of more than 4 kilo- watt hours; a $2,000 consumer rebate; municipal purchasing rebates between $750-$5,000. NYSERDA will be responsible for the management and governance of the program, and will be ensuring that the program goes into effect no later than one year after the budget is enacted. Giving manufacturers credit for a ZEV sale for simply delivering a vehicle to a dealership lot, does not sufficiently motivate OEMs to get these vehicles into consumers’ hands. Incentives for buyers and dealers are needed to overcome ‘built-in’ disadvantages. Specifically, it takes salespeople longer to explain how to use a ZEV, and customers are usually much more comfortable with technology they’re already familiar with. Financial incentives, while not a permanent solution, are effective ways to help sales along. This includes sizable customer rebates — especially important given cur- rently low gas prices — as well as payment bonuses for any salespeo- ple who deliver a ZEV. ‘Range anxiety’ is a major hurdle for customers to get over. In addi- tion, in cold weather regions like n n n n

— from the New York State Department of Environmental Conservation, California Air

Resources Board and Northeast States for Coordinated Air Use Management — and representatives from northeast dealer associations. GNYADA welcomed the group at the Javits Center, and Association President Mark Schienberg then start- ed the dialogue that would allow deal- ers to advise regulators on the chal- lenges of selling ZEVs in northeastern markets. During the talks, attendees also began brainstorming solutions. The current standards created by CARB mandate that 15% of vehicles sold in the US be ZEVs, by 2025. The NESCAUM states, including New York, have signed on to meeting this requirement. At the meeting, dealers were in agree- ment on the current barriers to achiev- ing CARB’s goal, in their respective

incentives for consumers considering a ZEV purchase, we commend Governor Cuomo and the Legislature for addressing GNYADA’s position that the State must create the right financial climate for buying and sell- ing clean-technology vehicles. GNYADA will continue working with NYSERDA and the Governor’s office to implement the most effective ZEV incentive program for dealers, con- sumers, and the state. the northeast, battery lives are greatly reduced when winter hits. Selling ZEVs will become much easier once battery technology improves. Bob Waterfall from the NYS DEC proposed a workgroup comprising various attendees of this initial meet- ing, to discuss and ultimately enact incentives. GNYADA commends the environ- mental agencies involved in this meeting for their eagerness to collab- orate with dealers on meeting these sales goals. GNYADA President Mark Schienberg addresses a panel of environmental agencies on the barriers to achieving CARB's 2025 goal.

NYS Legislature Agrees on ZEV Incentive Program

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The Governor’s Office and the NYS Legislature recently finalized the 2016-2017 state budget. GNYADA is happy to report that the budget includes a Zero Emission Vehicle (ZEV) incentive program for both consumers and municipalities. GNYADA has been working with the Governor, legislative leaders and environmental agencies since last year to enact such a program.

Key provisions of the program

While we would have liked greater

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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Dealer Obligations Contained in Latest Federal Highway Bill 4

The highway bill signed into law by the President in December contains provisions relating to vehicle recalls that dealers should be aware of. The first provision requires dealers to check for open recalls on any on- brand vehicle brought in for service.

compensation for recall repairs from dealers who neglect to do this.

more rental vehicles in their fleet in a calendar year to ground any recalled rental vehicles until the recall is remedied. The U.S. Secretary of Transportation is still developing these regulations, and we will inform members once they are finalized.

Dealers should direct their service advisors to check for open recalls whenever a vehicle they are fran- chised to sell is brought in for service work.

Per the highway bill, manufacturers would be permitted to withhold fair

The second provision requires rental car companies who average 35 or

Supreme Court Upholds CT Warranty Reimbursement Law Decision sets positive precedent for NYS dealers

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The U.S. Supreme Court recently denied a petition put forth by the Alliance of Automobile Manufacturers, asking the Court to overturn an appeals court decision that dismissed the Alliance’s lawsuit seeking to strike down Connecticut’s new vehicle warranty reimbursement law. The U.S. Supreme Court decision is the culmination of a three-year court battle defended by the Connecticut Automotive Retailers Association (CARA) and the Connecticut Attorney General, on behalf of the

State, with assistance from NADA.

The Supreme Court’s refusal to hear the case and the underlying courts’ decision to dismiss the Alliance’s lawsuit is very encouraging for other states whose franchise laws provide for warranty reimbursement, which includes New York. The Connecticut law, like New York’s, was passed to protect dealers against unfair treatment by manufac- turers on warranty claims. Had the Alliance prevailed in the Connecticut litigation, all state motor vehicle fran- chise laws would have been subject to legal attack.

CARA, represented by Richard Sox of Bass Sox Mercer, intervened in the case to defend the Connecticut fran- chise law. The Alliance challenged the constitutionality of Connecticut’s warranty reimbursement law, alleging that it violated the Commerce Clause, Contracts Clause and Due Process Clause. The Alliance argued that the CT law unfairly raised automakers’ costs of doing business in the state. Ultimately, neither court agreed with these positions.

Welcome New Members

New Dealers:

Allied Members: Benchmark n

Vanguard Dealer Services NextGear Capital

Fiat of Brooklyn Infiniti-Nissan of Manhattan Island Volkswagen Nissan of Mt. Kisco Rockland Nissan Rockville Centre GMC

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Business Networks Cablevision Media Sales Micro Graphic Information

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We’re proud to welcome some of the newest members to the GNYADA family:

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Services - Autotrieve

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Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016 3

NYC Bill Could Mean Jail-Time for Delinquent Wage Payment

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7 A new bill introduced in the New York City Council may change how businesses need to compensate inde- pendent contractors. The “Freelance Isn’t Free” Act would allow the NYC Department of Consumer Affairs (DCA) to enforce new rules regarding freelance pay- ment. If the bill becomes law, any freelance work valued higher than $200 — including singular projects for that amount — will require a written contract with a firm payment deadline. Employers will also face double damages for failing to meet contract parameters. In some cases, Provisions of New York State's Achieve Pay Equity Act (APEA) went into effect earlier this year. Dealers should review existing work- place policies, to assure they are in compliance with the new regulations. Equal pay for equal work The purpose of the equal pay initia- tive is simple: If two people are in the same job, they should receive the same pay. Under the APEA, there are only a few permissible exceptions to this requirement: education, training, experience, or provable factors that relate to job performance. Barring any of these, there should be no dis- parity in wages between male and female salespeople, warranty person- nel, office managers, etc. Equal pay proponents often cite prior job salary as a consideration that depresses women’s wages. Under the new law, using a new hire’s previous salary as a baseline to determine his

penalties could even entail incarcera- tion for the employer.

a freelancer could sue an employer for nonpayment, which would also impose penalties on top of the con- tractual damages. The threat of jail-time may seem harsh for a wage-payment violation, but it is not a new circumstance in NYS. Though rare, the State already provides for criminal charges for wage nonpayment. If adopted, the new law theoretically increases the likelihood of those instances. The Association will continue to monitor this proposal, as it moves through City Council. disclose what they make in conversa- tions with lower-level personnel. The new legislation also prohibits employees from divulging the wages of another employee without permis- sion. Geography is a factor Dealers who operate multiple facili- ties must give equal pay to employ- ees who hold similar positions within one geographical region (no larger than a county), even if they work at separate dealerships. This is admit- tedly one of the APEA’s tougher sells, as the definition of a “geo- graphical region” is highly debatable. Its aim, nevertheless, is to equally compensate similar workers who also have similar costs of living. If you have any questions on adjusting your dealership’s policies to comply with the state’s new equal pay laws, please call the Association: 718.746.5900

All independent contractors, which could include dealership valets, maintenance workers, detailers and more, would fall under the city law. Workers who complete tax form 1099 can already file wage-theft complaints with the New York State Department of Labor. But under this new bill, all NYC freelancers would be able to take similar action through the DCA.

Additionally, if the bill becomes law,

What Dealers Need to Know about NYS’s New Equal Pay Laws

or her new salary is impermissible, as that practice could perpetuate unequal pay. It will no longer be valid to say, “I’m paying this employee less than his or her prede- cessor, because he or she was earning less at a prior job.” No more secrecy around salary Businesses can no longer have poli- cies requiring compensation informa- tion to be kept confidential. The equal pay movement maintains that the wage gap between men and women can only be exposed — and ultimately corrected — if the work- place allows for salary figures to be shared among coworkers. Dealers can still instruct their staffs to exercise consideration in “water- cooler” conversations on this topic. For example, the new legislation intends for this dialogue to be had between peers. Managers, supervi- sors, etc. need not (and should not)

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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8 Poor Workers' Comp MODs Can Trigger Audits

These evaluations entail:

NYC dealers need to be aware of enforcement guidelines regarding antidiscrimination protections for transgender individuals. New rules affect health coverage, dress codes, bathroom usage, and more. Dealership policies may need to be amended, based on the following provisions of the new law: Employer health plans must now cover transition-related care or gender-affirming care, and the required medical leaves that may accompany either. These are now considered non-elective medical treatments, which must be treated in the same manner as other med- ical conditions. n If the New York State Compensation Insurance Rating Board (CIRB) con- tacts your dealership regarding the Department of Labor’s (DOL) Industrial Code Rule (ICR) 59, it’s because your dealership has an annual payroll of over $800,000 and a work- ers' compensation experience modifi- cation rating (MOD) of more than 1.20. That MOD number is well above the normal safe rating, so receiving such a note requires dealers to take immediate action. Contacted dealerships have 30 days to arrange a consultation and evaluation by a Safety and Loss Consultant. You’ll have to notify the DOL of the name, address and certification num- ber of the Consultant you have hired, in writing, within 10 days of setting up the evaluation. A company cannot impose gender- specific appearance standards. Your dealership may still maintain n

charge goes up an additional 5% for each year not in compliance.

professionalism requirements, such as business-attire or business- casual; however, there can be no sub-rule that only men can wear pants or only women can have long hair. Failure to address transgender workers using their preferred name, title or pronoun is now dis- criminatory. Instruct your staff to abide by these preferences. Any employee who does not demon- strate mindfulness or respect along these lines can and should be disci- plined just as they would in any other instance of coworker harassment. Employees must have access to the restroom or changing room of their presently identified gender. Review of safety procedures for employees Assessments of the employer’s compliance with ICR59 requirements Any hazard surveys the dealership must have done A list of certified consultants can be found on the DOL web site at: www.labor.ny.gov/WSLPIP.html . The evaluation must be completed, and the consultant’s written report delivered, within 75 days of receiving the notice. Employers must then send copies of the evaluation to both their insurance carrier and the DOL. The penalty for noncompliance is a 5% surcharge on your workers’ compensation premium. The sur- n n n

This national civil rights issue has rapidly gained traction in recent years. In January, a federal appeals court in Atlanta allowed a transgen- dered technician’s wrongful termina- tion claim to proceed to a trial. The tech's case started building several years ago when she first transitioned, and specifically references some of the issues listed above in proving a discrimination pattern. NYC’s new guidance allows victims to file a complaint with the Commission’s Law Enforcement Bureau within one year of a violation. They can also file a complaint in the New York Supreme Court within three years. In addition to any dam- ages that may be owed to the victim of the discrimination, employers could also be fined up to $250,000 for a violation. It’s in every employer’s best interest to maintain a safe working environ- ment for their employees, to minimize the number and severity of injuries. Proactive safety measures also con- tribute to reducing MOD ratings, which in turn, lowers Workers’ Comp premiums. GNYADA offers a very competitive Workers’ Compensation Program for GNYADA member dealerships. To arrange a complimentary review of your existing program or to discuss your dealership's MOD rating, please contact Michael W. Conway, Executive Director of the GNYADA Insurance Brokerage, at 718.746.8100 or mconway@gnyada.com .

9 NYC Adopts New Transgender Protections

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Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016 5

NYS Sales Tax — How to Determine Residency 10

ing a DTF-820 form (Certificate of Non-Residency of New York State and/or Local Taxing Jurisdiction). If a customer does not complete this form and subsequently feels they were taxed in error, they can go online to tax.ny.gov and apply for a refund of overpaid sales tax. It’s important to pay attention to the various definitions of residency. Dealers are advised to consult their accountants or tax professionals and take precautions to avoid disastrous tax consequences. For any further questions about when to collect New York State sales tax, or which other states are reciprocal with New York — meaning they’ll grant double-taxed individuals a credit for sales tax paid in New York — call DMV-DIRECT: 718.747.0400.

sales tax should be collected.

New York dealers are legally required to collect New York State sales tax in any transaction where the customer maintains a “place of abode” in New York. Failure to do so — particularly if there is a long-run- ning pattern of non-collection — can incur drastic financial penalties. For this reason, dealers should be aware of circumstances where a cus- tomer's residency status requires NYS sales tax to be charged. According to the NYSDTF’s Publication 838 — A Guide for Sales Tax for Automobile Dealers — an individual’s “place of abode” can be established in a number of ways:

Customers can be considered NY residents if they maintain vacation homes here, or even if they keep mobile in-state residences, such as a trailer or houseboat. Students attending college out-of- state still qualify as NY residents, as do military members stationed out-of-state. New York State sales tax must also be collected when a vehicle is being registered to a business in New York. If a corporation is incorporated under the laws of New York, it qualifies as a New York business. Customers who claim not to reside — even partially — in New York State must confirm this by complet- n n

If a customer wants to register their vehicle in another state but still holds a NY driver’s license,

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Thank You for Your Commitment to GNYADA 11 We’d like to thank all members who renewed their membership for 2016! able to secure the following legisla- tive wins, in the past year alone: Among the Association’s many annual goals, our number one

priority remains to support, promote and advocate for your interests, all year round. We thank you again for your decision to renew, and we anticipate a produc- tive and prosperous 2016 for both GNYADA and its great members. If you have questions about your benefits, please don’t hesitate to contact the Association at

We’re proud to report that 95% of our members have renewed. We value the opportunity to grow each of these important relationships, and we look forward to strengthening our services and support as GNYADA moves into its 106th year. Our ability to maintain an engaged and devoted membership has direct impact on our strategic presences in Albany and Washington. By keeping the dealer’s voice strong, we’ve been

Assuring Congress’s passage of the “Reforming CFPB Indirect Auto Financing Guidance Act” Brokering New York State’s first ever incentive program for selling ZEVs Moving the State closer to imple- menting electronic MV-50s Defending the Franchise System against threats from both manufac- turers and “popup” sellers circum- venting the dealer model And more

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718.746.5900 or via email at membership@gnyada.com .

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Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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NYS Franchise Law Limits OEM Audits

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however, it can be demonstrated through patterns of false submissions. Barring such a pattern, an auditor’s unilateral claim of “fraud” should not grant access to older records. Day-to-day conduct limits Auditors — in the case of both war- ranty and incentive audits — do not have unfettered access to dealership records or personnel. They cannot rummage through salespeople’s or service writer’s desks. An audit team cannot disrupt the ordinary business of the dealership. Dealers should set aside a separate room for the auditors’ use and desig- nate a trusted employee to be their liaison. The auditors should request documents and employee interviews through that liaison only; they Dealers should review their policies and employment applications, and revise if necessary, in order to comply with the new protected classification. NYC COUNCIL MANDATES EMPLOYEE PROTECTIONS FOR CAREGIVERS Another new protected category was established when Mayor Bill de Blasio signed a bill prohibiting employment discrimination against caregivers. This law takes effect May 3, 2016. The new city law defines “caregiver” as a “person who provides direct and ongoing care for a minor child or a care recipient.” “Care recipient” is very broadly defined and applies to less time and energy to devote to the job.

shouldn’t be communicating with other employees or roaming the premises. Post-Audit Protocol At the conclusion of the audit, the manufacturer is legally required to thoroughly explain any proposed chargeback amount so that the dealer has an opportunity to explain their position. Following any necessary internal dispute resolution procedures (e.g., mediation), the manufacturer then has to give written notice of the final amount. If the dealer disagrees with the audit results, they have 30 days to challenge them through a protest proceeding at the DMV.

When manufacturers conduct audits of dealerships, dealers should know that New York Franchise Law sets specific limitations on the auditors. While your manufacturer does have the right — per to the terms of the Dealer Agreement — to audit your store, if audits occur more than once a year, that qualifies as prohibited harassment under the franchise laws. Look Back Period All audits are limited to a 12-month look back period, starting from the date the manufacturer paid the dealer. The manufacturer can only refer to earlier claims (up to five years) if the initial audit finds claims to have been fraudulently submitted. “Fraud” requires knowing misrepresentation, which can be challenging to prove; “FAMILIAL STATUS” Per New York State’s “End Family Status Discrimination” legislation, “familial status” is now considered a protected classification, like religion or age. Employers are prohibited from inquiring about familial status in their hiring processes or in making employment decisions. The goal of the law is to exclude factors like pregnancy and parenthood as consid- erations in determining whether to hire or promote a worker, and how much to pay them. According to the Governor’s Office and the Women’s Equality Coalition, disclosure of familial status inadver- tently disadvantages applicants who are mothers. For example, a manager may opt to hire a non-parent over a mother of three, subconsciously assuming that the mother will have

This article was provided by Richard Sox, Esq. from Bass Sox Mercer.

New Protected Categories in NY Employment 13

any person who relies on the caregiv- er to meet their daily needs.

NYC employers may not terminate, refuse to hire, or limit the payment or privileges of an employee, based on their actual or perceived status as a caregiver. Moreover, they should review and update their HR policies to assure that they steer clear of dif- ferential treatment toward employees with such responsibilities. (Employers should also be aware that an employ- ee’s request for FMLA leave may constitute notice of caregiver status.) If your dealership needs help with drafting policies or wording applications, please contact Susan Bieber at the Association: susan@gnyada.com or 718.746.5900.

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016 7

GNYADA Named 'Partner of the Year' by Department of Education 14

Technical Education and the United Federation of Teachers, at its head- quarters in Manhattan. The award recognizes GNYADA’s excellence in supporting CTE schools, staff and students in a num- ber of areas, including; teacher train- ing, mentoring, scholarships, compe- titions, program review and work experiences for students. GNYADA was commended for initi- ating a teacher externship program that put NYC automotive instructors to work at local franchised new car dealerships’ service centers. The externships offered teachers a first- hand look at what it’s like to work in today’s automotive retail business as well as providing some professional contacts for future networking.

GNYADA Education Committee Chairman Nick Toomey (L) and Association VP of Education Ed Gazzillo (R) with NYC DOE Executive Director of CTE John Widlund.

GNYADA recently received the first ever CTE Partner of the Year Award , from the New York City Department of Education (DOE).

The award was given at the DOE's Annual CTE Partner Appreciation Event, in collaboration with the Advisory Council for Career &

Internal Fraud: Protect Your Dealership

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Internal audit controls are vital to monitoring your dealership’s financial status and staving off audits by regu- lators. They’re also important in detecting and deterring fraud from within the dealership.

and employees should be regularly retrained to use it.

bank accounts and cash clearing accounts. Review cancelled checks for prop- er endorsements by payees. Review bank activity daily, paying attention to any unusual transac- tions. Limit and control the ability to wire money out of the dealership’s bank accounts. Train and cross-train all employees handling cash, and continue to monitor positions that involve cash receipting, depositing, posting and reconciling. Make sure employees know to report all cash transactions over $10,000 by using IRS Form 8300. That filing compliance is ongoing,

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The above list is not all-inclusive of financial best practices, but these sug- gestions go a long way in demonstrat- ing the dealership’s robust audit poli- cy, deterring fraud and safeguarding dealership assets. Dealers should regularly perform self-audits, review bank statements, and perform random inventory counts during the year.

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Best Practices to Prevent and Detect Fraud

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Review cash receipts for proper coding, and closely review any changes made to payment types. Segregate accounting duties (payables, receivables and cash). Perform physical inventories using accounting sources as the control. Have an outside source perform unannounced reconciliations of

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Thanks to Christine Andrews of WithumSmith+Brown for her contributions to this article.

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Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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Tracking Workers’ Hours Helps AvoidWage Claims 16

aren’t always on dealership prem- ises — such as porters — you’ll want to arrange an electronic sys- tem they can use remotely, or have them submit a timesheet when they come by the store. If a submitted record of hours worked needs to be adjusted, it should be done in the same week — it’s far easier to make correc- tions within the pay week than at a future point. Any change should also be initialed by both the supervisor and the employee. There are circumstances where employees may be exempt from federal overtime, but still owed overtime pay under New York State law, and sign-in systems are important for documenting those instances. Never change an employee’s record of hours worked, without his or her knowledge.

But the law requires a record of hours actually worked.

Legal disputes over unpaid wages continue to make headlines, both inside and outside the automotive industry. Last month, Bloomberg L.P. agreed to pay $3.2 million to settle a class action brought by employees allegedly denied overtime pay. In addition, a New York federal court is currently reviewing a $5.5 million class action settlement brought by sales representatives from a local dealer group. Violations in that case also include unpaid overtime. These active claims against high-pro- file employers should serve as reminders about the importance of tracking employees' work hours thor- oughly and properly. Such records can be critical tools in defending against wage claims such as the ones mentioned above. To assure accurate employee time records, dealers should keep the following in mind: Work schedules are not time records. Schedules are put togeth- er in advance, to reflect hours an employee is supposed to work. n The New York State Department of Labor recently stated that 769,000 private-sector jobs have been added throughout the state since 2009. A further analysis conducted by Crain’s Business reported that the downstate region — and New York City in par- ticular — accounted for an over- whelming share of that job growth. Roughly 80%, in fact. GNYADA subsequently asked Auto Outlook to examine the numbers from the state’s job study, and to delve into what this employment 17

Employee contracts/company handbooks must be extremely clear regarding how hours are tracked. In the Bloomberg exam- ple, employees are able to docu- ment their own hours worked, based on when they entered/exited the office, when they were active at their stations, and even when they conducted work using their mobile phone. Related to the above bullet, deal- ers should be aware that computer logins and logouts are imperfect tracking methods. The method is vulnerable on both ends: a super- visor can give somebody duties before they login to their comput- er; or, a worker can login and then go grab a bagel. There is no universal system for recording workers’ hours, and dif- ferent departments can use differ- ent tracking methods. Technicians may be able to clock in and out of the shop; but, for employees who boom has meant for auto sales in our region. The resulting data spoke vol- umes, revealing a distinct parallel between job growth and vehicle sales. Auto Outlook estimates that 46,785 of the units sold by local new car deal- ers since 2009 are attributable to the employment increase. Their analysis showed that for each additional indi- vidual employed in the area, new car sales increased by 0.075 units; multi- plying that by the 623,800 jobs that were added in greater New York dur- ing that period brings us to the

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For any further questions regarding tracking hours worked, please contact the Association: 718.746.5900

Job Growth = Car Sales in Metro NY

46,785 figure. What all this amounts to, is that not only should dealers in our region take pride in the jobs they’ve personally helped to create; they should also be greatly encouraged by the effect that overall downstate employment has on their business.

GNYADA thanks Jeffrey A. Foltz, Editor of New York Auto Outlook, for his contributions to this article.

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016 9

Scion’s Discontinuance Is a Reminder to Dealers NY Franchise Law Protects Members during Brand Closures

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Reimbursement (on a sliding scale based upon date of installation) for Scion kit cost. Coordination and payment for the cost of modifying brand signage, including the monolith and dealer- ship fascia signage. Further Protections Available under New York Law Although these benefits are both welcome and necessary, under New York law, the discontinuance of a line-make obligates the manufac- turer to also pay for the following:

Toyota Motor North America (TMNA) announced the end of its Scion brand in February. Thanks to GNYADA’s successful updates to the Franchised Motor Vehicle Dealer Act, regional Toyota dealers have legal rights in place in the event of such a brand closure. These rights entitle any dealer who sells a discontinued brand to valuable benefits beyond what’s offered by the manufacturer. In its communication, Toyota informed Scion dealers that Scion vehicles will be rebadged as Toyotas, starting with the 2017 model year. The manufacturer also indicated that it will offer the following: $10,000 to each store, to cover the removal of Scion branding. (Additional costs must be approved for reimbursement.) n

Supplies, parts, equipment, special tools and furnishings purchased pursuant to manufacturer require- ments. Facility renovations or remodeling required by the manufacturer com- pleted within three years of the discontinuance announcement.

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The amount remaining on the deal- ership’s management computer.

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System lease used for the brand (if applicable).

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Reasonable rental value associated with the franchise operations for one year. Scion dealers are encouraged to speak with their dealer lawyer to identify specific repurchase benefits and determine how to best make this request of TMNA. n

New, current model year vehicles in dealership inventory.

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New, noncurrent model year vehi- cles acquired from the manufactur- er within 180 days of the effective date of the termination.

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Body Shops Exempted from New OSHA Ruling

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OSHA has exempted automobile body shops, including those in New York State and City, from its newly-released rule gov- erning respirable crystalline silica, a hazardous mineral found in construction materials but sometimes also in body filler. The exemption shields dealerships from costly new mandates for workplace exposure control measures, exposure record- keeping and employee medical examinations. NADA successfully demonstrated to OSHA that the likelihood of exposure to respirable crystalline silica in a dealership body shop is so minor that they should be exempt from the rule. Body shops performing tasks consistent with normal work- place health and safety controls may rely on the exemption, which is based on recognition by OSHA that exposures will not exceed the new regulatory levels under foreseeable conditions.

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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Social Media Dos and Don'ts for Dealers

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where all this info should be con- tained as well.

channels, don’t let them become dor- mant. It may be easy to let weeks go by without checking your accounts, but this sacrifices valuable time in customers’ newsfeeds. It also makes your business look unorganized. Thankfully, some platforms allow you to strategically time posts and updates, so several can be “back- loaded” in.

If your dealership already has a presence on platforms like Facebook, Twitter or Instagram, you probably know what a great shot in the arm they can be for your business. Here are the top ways you can use social media to boost business, along with some tips for avoiding common misuses: 1 Post a steady flow of pictures and videos that showcase your vehicles. Not every business has the same opportunity to frequently feature bright, colorful visuals online. Take advantage of this. Even videos shot with smartphones go a long way. Think of them as virtual walk- throughs of your dealership, enticing social viewers to come for a visit. 2 Don’t leave basic information out of your dealership’s social profiles. (Address, phone number, hours of operation, customer service email address — even driving directions to your store.) Also, feature a prominent link to your dealership’s website,

3 If you run promotions or specials, announce those discounts regularly on social media. Consumers naturally react stronger when they have a chance to save money. Although, be wary not to inundate your social fol- lowers with constant advertisements, particularly when there’s no special offer. The last thing you want is for people to unfollow you because they feel bombarded. Posting photos, updates, and info about special events is a nonaggressive form of advertis- ing, and a good fit for social media. 4 Publically engage customers and address criticisms. Designate a knowledgeable employee with strong social media skills to be your admin- istrator here. Quick answers to ques- tions and a helpful approach to objec- tions can shine a positive public light on your dealership.

Auto Dealer Advertising Rules & Regs May 25, 2016 10am-12pm Center for Automotive Education & Training

Save the Date: New Seminar

15-30 Petracca Place, Whitestone NY 11357 To register, contact Phyllis: phyllisA@gnyada.com/718.746.5900

5 If you’re going to have social

Experian Reports Increase in Vehicle Financing Dollars

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The average amount financed for a new vehicle rose by $1,170 year over year, and average monthly payments increased from $482 to $493, accord- ing to the latest numbers published by Experian Automotive.

The average interest rate for a new vehicle loan was 4.63%, versus 8.78% for used. 29% of new vehicles and 16.4% of used vehicles had loan periods between 73 and 84 months. Experian speculates that the bump in loan amounts is occurring because consumers are relying on leases and used-vehicle purchases, in order to stay within their budgets. In line with this trend, consumer leasing also n n

accounted for 50.7 percent of all new vehicle financing in New York; also worth noting, used-vehicle loans accounted for nearly two-thirds of all vehicle financing. Q4 also saw extensions in loan terms. The average loan terms for both new and used vehicles stretched by one month each, versus Q4 2014.

Additional findings reflected in Experian’s data:

Reliance on financing continues growing – 85.9% of all new vehi- cles and 54.7% of all used vehicles were financed.

n

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016 11

EMPLOYMENT CORNER

Lower Your Shipping Costs

22

GNYADA’s Employment Corner is a free recruiting and job placement service that lists qualified candidates for positions at dealerships. If you have a position to fill, call 718.640.2012 .

GNYADA’s Dealers Discount Club (DDC) is pleased to bring you a special opportunity to save on packaging and shipping from UPS ® Shipping Services. In addition to competitive rates, members can save up to 35%, plus 50% off select services for up to four weeks after you enroll in the UPS ® Savings Program. Ways dealers can save: Save up to 35% on UPS ® Air letters including Next Day Air ® Save up to 31% on UPS ® Air packages (1 lb.+) Save up to 33% on UPS ® International imports and exports Save up to 21% on UPS ® Ground shipments Savings begin at 75% on UPS ® Freight shipments over 150 lbs. Visit savewithups.com/gnyada or call 1-800-MEMBERS (1-800-636-2377), M-F, 8am-6pm EST to enroll. Say you are a GNYADA member, to compare your current rates. n n n n n

GNYADA DeAler Depot

The following equipment is for sale by GNYADA members:

File Shelves Height: 7’ / Width: 7’ Eight shelves in total

To purchase, please call John Zahra: 718.654.8072 x205

Hunter P811 Aligner w/ P411 Cabinet and DSP 600 Sensors Windows PC - WinAlign software version 8.1.2 2014 Specs Ink printer and 19" monitor Purchased 5/2006

4-Post Benwil Alignment Lift Serial# B979943 Model# FP-12 Max capacity 12,000 lbs. 6,000 lbs. per axle Hunter GSP 9600 Wheel Balancer - Quick Match Shaft and collets within operating tolerances Purchased 4/2006

Hunter TC3500 w/ Side Shovel Tulip style clamping Purchased 4/2006

For a list of DDC Vendors, contact Jennifer Berman at Jennifer@gnyada.com .

To purchase, please call Rob Certilman: 631.382.4820

Contact Us: Greater New York Automobile Dealers Association 18-10 Whitestone Expressway l Whitestone, NY, 11357

Dealer Hotline: 800.245.4640 l Headquarters: 718.746.5900 l email: assistance@gnyada.com DMV-DIRECT: 718.747.0400 l GNYADA Insurance Brokerage, LLC: 718.746.8100 l NYIAS: 718.746.5300 Center for Automotive Education & Training: 718.640.2000

The information contained in this newsletter may not be relied upon for the avoidance of tax penalties. Readers are urged to discuss any issues raised in this newsletter with their legal and tax professionals.

Printed on FSC certified material. All original material except where noted. © GNYADA 2016

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • April 2016

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